Inventory Plummeted to a Record Low, and Spot Premiums Surged [SMM South China Spot Copper]

SMM, December 20:

Today, spot premiums for Guangdong #1 copper cathode against the front-month contract were quoted at 230-280 yuan/mt, with an average premium of 255 yuan/mt, up by 90 yuan/mt from the previous trading day. Hydro copper premiums were quoted at 150-210 yuan/mt, with an average premium of 180 yuan/mt, also up by 90 yuan/mt from the previous trading day. The average price of Guangdong #1 copper cathode was 73,960 yuan/mt, down by 45 yuan/mt from the previous trading day, while the average price of hydro copper was 73,885 yuan/mt, down by 45 yuan/mt.

Spot market: Guangdong inventory has declined for four consecutive days, hitting a new low for the year. The main reasons were limited arrivals and significant outflows from warehouses. With inventory already at a record low, suppliers actively stood firm on quotes. In the early session, standard-quality copper was quoted at a premium of 180 yuan/mt but was quickly sold out. Suppliers continued to stand firm on quotes, and by 11 a.m., premiums for high-quality copper against the front-month contract were at 280 yuan/mt, standard-quality copper at 230 yuan/mt, and hydro copper at 180 yuan/mt. Moving forward, attention will focus on whether inventory can increase; if not, premiums are likely to rise further.

Overall, inventory saw a significant decline, hitting a record low, while spot premiums surged, and overall trading was moderate.

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